All Eyes on Inflation Data as Bonds Soar

The price of a benchmark 10-year bond maturing in 2022 was 103.79 rupees ($1.90) at noon local time on Monday versus 102.66 rupees a week earlier–a big jump in the bond world.

Investors will be eyeing India’s inflation data Tuesday for clues on the longevity of a rally in Indian government bonds, which are trading at an almost three-year high.

Expectations of massive bond buying by India’s central bank and additional cuts in interest rates over the next few months are driving the rally in government bonds, because a lower interest rate would make bonds that were issued at higher rates more valuable.

The price of a benchmark 10-year bond maturing in 2022 was 103.79 rupees ($1.90) at noon local time on Monday versus 102.66 rupees a week earlier–a big jump in the bond world.

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